MORE is aiming to achieve first close of its fourth fund by August and conclude the fundraising over the next 9-12 months. Last year, the fund raised over Rs 1,000 crore of which about 80% has already been deployed across 13 transactions.

This fund’s strategy would be an extension of the investment strategy of MORE’s two earlier funds IREF II and IREF III. It plans to deploy the capital in mid-income and affordable residential projects across the top 6 cities in India including Mumbai, Delhi-NCR, Pune, Bangalore, Hyderabad and Chennai, while selectively investing in commercial projects.

“Over the last 18 months, we have seen a slew of reforms by the government that has compelled developers to bring about a radical change in the way they go about their business. We believe that the sector will go through a recovery cycle over the next five years,” Sharad Mittal, director & CEO of MORE, told ET.

IREF IV will focus on early stage structured equity and structured debt investments with established developers and undertake total 12-15 transactions in the range of Rs 80 crore to Rs 150 crore each.

MORE is part of Motilal Oswal Private Equity (MOPE) that is the alternative investments platform of Motilal Oswal Group. MOPE has Rs 5,000 crore of total assets under management (AUM), while the real estate fund business stands at Rs 2,100 crore.

“Our real estate fund business continues to be a critical piece of our private equity fund management business. We are bullish on the Indian story and see abundant opportunities in the sector to scale up as we seek to achieve an AUM of more than $ 1 billion over the next three years,” said Vishal Tulsyan, CEO of MOPE.

MORE till date has invested capital in the real estate sector through three real estate funds and portfolio management service (PMS) and proprietary investments. The cumulative AUM under MORE is spread across IREF with Rs 200 crore, IREF II with ?500 crore, IREF III with Rs 1,030 crore, while balance is under PMS and proprietary investments.

The fourth fund has been set up as an Alternate Investment Fund (AIF Category II) registered with the capital markets regulator Securities & Exchange Board of India (SEBI). Total tenure of the new fund will be seven years including two extensions of one year each.

MORE’s second fund, IREF II, which achieved its final close in 2015, has till date made 14 investments and secured seven complete exits at an investment level internal rate of return (IRR) of 22.1%.

The Fund has returned around 81% of the money back to its investors. IREF III, which achieved its final close last year, has till date made 13 investments and secured two complete exits at an investment level IRR of 22.3%.

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